Is Dabur family coming in as the saviour of Khaitan’s Eveready?
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The Burman family, which controls fast-moving consumer goods giant Dabur India Ltd, has increased its stake in battery maker Eveready Industries India Ltd to nearly 20%.

The family, through five privately held firms, bought an 8.49% stake in the battery maker on the open market to take its stake to 19.84%, Dabur and Eveready said in separate stock-exchange filings on Tuesday.

Delhi-based Dabur said this is a personal investment by the Burman family and doesn’t affect the FMCG company.

“This is a portfolio investment by the Burman family. It’s a personal investment of the Burman family and is not connected to Dabur India Ltd,” said Mohit Burman, vice chairman at Dabur.

Shares of Kolkata-based Eveready jumped by the maximum upper limit of 10% to close at Rs 88.90 apiece on the BSE on Tuesday, defying the 1.8% fall in the 30-stock benchmark Sensex.

The shares are now near their one-year high of Rs 94.80 apiece, touched in February, after soaring from the low of Rs 34.40 in October last year.

Stock-exchange data showed a Burman family entity purchased Eveready shares at Rs 81.80 apiece on Tuesday. At this price, the family would have shelled out around Rs 50.5 crore for the 8.49% stake.

The sellers of this stake couldn’t immediately be identified as the transaction was routed through Vistra ITCL India Ltd, which is India’s largest independent corporate trustee and released the pledged shares of Eveready.

The Burman family owned an 11.14% stake in Eveready at the end of March, stock-exchange data show.

Meanwhile, the stake of Eveready’s promoter Khaitan family and promoter group firms has dropped over the past year. The promoters held almost 44% of Eveready at the end of March 2019. This fell to 23% in March this year.

Moreover, close to 80% of the promoters’ stake in Eveready was pledged at the end of March 2020. Some of this pledged stake was with DMI Finance Pvt. Ltd, a non-bank lender that counts the Burman family among its shareholders. DMI Finance invoked some of the pledges last month.

Eveready, one of India’s largest battery makers, is part of the Williamson Magor Group. The group has business interests also in the engineering and packaged tea sectors through Mumbai-listed units McNally Bharat Engineering Co. Ltd and McLeod Russel India Ltd, respectively.

The group has been struggling to repay its debts for the past few years and has been selling assets. McLeod Russel, for instance, has sold several tea estates in India and Rwanda.

Earlier this month, Eveready said it had sold two land parcels in Chennai and Hyderabad. This helped the company increase its net profit for the year through March 2020 to Rs 179.57 crore from Rs 47.26 crore the year before. However, profit before these one-off items had fallen 17% to Rs 68.48 crore from Rs 82.35 crore.

The company’s net sales for 2019-20 slipped 17% to Rs 1,210.93 crore, hurt partly by a nationwide lockdown imposed in March to control the coronavirus pandemic.

Burman Family Holdings, the investment arm of the family, has been investing for two decades and has deployed $500 million across a range of businesses, its website shows. Its portfolio includes RBL Bank, DMI Finance, Policybazaar, Samhi Hotels and the Kings XI Punjab cricket team.

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